Oilgear (NASDAQ:OLGR)
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The Oilgear Company (NASDAQ:OLGR) today announced that
the company will restate certain of its previously filed consolidated
financial statements. The restatements are not expected to
significantly affect the reported results of operations for 2005 or
the company's current financial position.
As previously reported in the company's Form 10-Q/A for the second
quarter of 2005 and its Form 10-Q for the third quarter of 2005, the
company made an error in its accounting for non-operating income
resulting from the sale of shares received in an insurance company
demutualization. The principal expected effect of this change will be
to decrease net earnings for 2004 by $188,000 and decrease the net
loss for 2001 by that amount.
The company will file amendments to the Form 10-K for the year
ended December 31, 2004 and each of the Forms 10-Q for the fiscal
quarters ended March 31, 2005, June 30, 2005 and September 30, 2005,
as soon as possible. The company does not expect that the restatement
process will delay the company's announcement of its 2005 results or
the filing of its Annual Report on Form 10-K for the year ended
December 31, 2005.
The company's decision to restate its financial statements was
made by Oilgear's Audit Committee. The decision was based upon the
recommendation of management, after consultation with KPMG LLP, its
independent registered public accounting firm, and in connection with
a review of the company's most recent Form 10-K and certain of its
2005 Forms 10-Q filings by the Division of Corporation Finance of the
U.S. Securities and Exchange Commission.
The company also expects to make certain reclassification
adjustments to its historical consolidated financial statements which
will have no impact on the company's current equity or financial
position. In addition, the company will make certain adjustments in
its historical consolidated financial statements that were not
previously recorded because in each case and in the aggregate the
underlying errors were not considered material to the company's
consolidated financial statements. Accordingly, the company's
previously issued financial statements should no longer be relied
upon. In addition, while this news release describes items for which
the company has determined a restatement is appropriate at this time,
there can be no assurance that further review of the company's
financial statements will not identify additional items that would
lead to further changes.
"We will strive to complete our restated financial statements as
quickly as possible and put this unfortunate issue behind us," said
Oilgear President and CEO David Zuege. "The restatement will not
impact the operation of our ongoing business and, with the hard work
and dedication of our employees, we remain cautiously optimistic about
the outlook for 2006."
A leader in the fluid power industry, The Oilgear Company provides
advanced technology in the design and production of unique fluid power
components and electronic controls. The company serves customers in
the primary metals, machine tool, automobile, petroleum, construction
equipment, chemical, plastic, glass, lumber, rubber and food
industries. Its products are sold as individual components or
integrated into high performance applications.
Certain matters discussed in this press release are
"forward-looking statements" intended to qualify for the safe harbors
from liability established by the Private Securities Litigation Reform
Act of 1995. These forward-looking statements can generally be
identified as such because the context of the statement will include
words such as the Company "believes," "anticipates," "expects" or
words of similar import. Similarly, statements that describe the
Company's future plans, objectives or goals are also forward-looking
statements. Such forward-looking statements are subject to certain
risks and uncertainties which could cause actual results to differ
materially from those currently anticipated. In addition to the
assumptions and other factors referenced specifically in connection
with such statements, the following could impact the business and
financial prospects of the Company: factors affecting the economy
generally, including the financial and business conditions of the
Company's customers, the demand for customers' products and services
that utilize the Company's products, and national and international
events; factors affecting the Company's financial performance or
condition, including restrictions or conditions imposed by current or
prospective lenders, tax legislation, and changes in accounting
principles; factors affecting percentage of completion contracts,
including the accuracy of estimates and assumptions regarding the
timing and levels of costs to complete those contracts; factors
affecting the Company's international operations, including
fluctuations in currencies, changes in laws and political or financial
insecurity of foreign governments; factors affecting the Company's
ability to hire and retain competent employees, including unionization
of non-union employees and strikes or work stoppages; any further
decrease in stock price as a result of market conditions; changes in
the law or standards applicable to the Company, including
environmental laws and accounting pronouncements; availability of raw
materials; unanticipated technological developments that result in
competitive disadvantages and may impair existing assets; and factors
set forth in the Company's periodic reports filed with the SEC in
accordance with the Securities Exchange Act. Shareholders, potential
investors and other readers are urged to consider these factors and
those set forth in the Company's filings with the SEC carefully in
evaluating the forward-looking statements. The forward-looking
statements made herein are only made as of the date of this press
release and the Company undertakes no obligation to publicly update
such forward-looking statements to reflect subsequent events or
circumstances.